Why Medical Marijuana Stores Are Fighting Legalization

Today, Washington is one of about 15 U.S. states where medical
marijuana dispensaries can operate—on the state level, at
least—legally. With a doctor's signature, patients in The
Evergreen State can purchase cannabis from one of hundreds of
dispensaries within the state. Or, if they prefer, they can grow
it on their own.

So last summer, when Washington state legislators introduced an
initiative to legalize marijuana entirely, those who drafted
the initiative anticipated a fair amount of support from its
established pot-growing-and-selling community. After all,
the initiative, known as I-502, would license and regulate
marijuana production, remove state-law criminal and civil
penalties for smoking marijuana, tax marijuana sales, and
eventually profit from it.

But the drafters of the bill found just the opposite: Businesses
that sell medical marijuana are leading the charge against I-502,
and have already mobilized against it.

"The groups that traditionally oppose legalization—conservatives
and cops—are not the ones leading the campaign to kill I-502,"
Dominic Holden, a news editor for The Stranger, a
Seattle alt-weekly, wrote recently. "The people leading the campaign to
kill I-502 are, paradoxically, other pot activists—specifically,
pot activists with ties to the medical marijuana community:
dispensary owners, medical marijuana lawyers, medical marijuana
patients, medical pot trade magazines, doctors who give medical
marijuana authorizations, etc."

The group, "No on I-502," claims that, in essence, I-502 creates
more problems than it solves. They're particularly vocal about a
clause in I-502 that would
persecute anyone over the THC limit of 5 ng/mL while
driving—weed's version of a DUI. They argue this stipulation will
spur "prosecution of a huge amount of innocent
individuals—especially patients…Regular smokers will fail a 5
ng/mL test many hours after smoking, meaning if an individual
smokes a joint, and they decide to drive 10 hours later, they
could get a DUID, regardless of the fact that they won't be
impaired."

The group, founded by Gil Mobley, a doctor who owns a medical
marijuana clinic, says that the legislation will also fail at
generating any cash for the state.

"Even if legal markets were to ever see the light of day, the
unreasonable tax structure would stop this initiative from having
a positive effect in stopping the black market," he writes on the
organization's site.

By 2016, the marijuana market could surge to $8.9 billion. To give
some perspective, that's more than the annual GDP of the
Bahamas—by about a billion dollars.

Certainly, these are valid reasons to oppose the bill. But there
is perhaps a more direct reason medical marijuana dispensary
owners fear the legislation: If pot becomes legal, and can be
sold anywhere, their niche businesses lose value. It begs the
question, why should your customers travel
to your dispensary when they could just get
their weed from CVS or
Walmart or gas station down the street?

"What's the threat?" writes Holden in an opinion article for
the The
New York Times. "A legal, regulated market for all
consumers—not just sick people—could negate demand for a niche
medical pot industry altogether."

The dispensary business is huge. According to See Change
Strategy, a think-tank that conducted an industry-wide analysis
of the medical marijuana trade, the current national market for
cannabis is $1.7 billion. By 2016, the marijuana market could
surge to $8.9 billion. To give some perspective, that's more than
the annual GDP of the Bahamas—by about a billion dollars.

The new legislation reveals a potential pitfall of the dispensary
business in that it survives—and thrives—as a niche model for
medical patients. But the legalization of marijuana presents
troubling signals for dispensary entrepreneurs. Allen St. Pierre,
executive director of the National Organization for the Reform of
Marijuana Laws, weighed in for Holden's article.

"The medical marijuana industry is driven by profit," he said.
"It's not driven by compassion anymore. It is driven by the need
to make money."